Reisman v. New Hampshire Fire Insurance Company
| Decision Date | 09 January 1963 |
| Docket Number | No. 19100.,19100. |
| Citation | 312 F.2d 17 |
| Parties | Lillian REISMAN, Appellant, v. NEW HAMPSHIRE FIRE INSURANCE COMPANY, Appellee. |
| Court | U.S. Court of Appeals — Fifth Circuit |
Arthur Roth, Miami, Fla., for appellant.
Cromwell A. Anderson, Miami, Fla., for appellee.
Before CAMERON, JONES and GEWIN, Circuit Judges.
Lillian Reisman, plaintiff-appellant, appeals from a judgment in favor of New Hampshire Fire Insurance Company, defendant-appellee, hereinafter called insurer, on an insurance policy issued by New Hampshire to Mrs. Reisman on a houseboat which sank in the Intercoastal Boat Yard in Miami, Florida, on or about July 29, 1959.
The policy of marine insurance issued by the insurer covered the Jopson built houseboat owned by Mrs. Reisman. It contained the following typical insuring clause:
"Touching the adventures and perils which we, the assurers, are contented to bear, and do take upon us, they are of the seas, rivers, lakes, and/or other inland waters, fire, assailing thieves, jettisons, barratry of the Masters and Mariners, and of all other like perils, losses and misfortunes, that have or shall come to the hurt, detriment, or damage of said yacht or any part thereof."
In July 1959, Henry Meyers of C. A. Hansen Corporation, insurer's Miami agent, went to Dinner Key Yacht Basin in Miami, Florida, where the vessel was permanently maintained, inspected the boat, and wrote the following in a letter to Mrs. Reisman:
"I notice the bottom of your boat is excessively foul with barnacles and oysters, therefor it is time that the boat was hauled for a paint job."
Mrs. Reisman and her husband made arrangements with the Intercoastal Boat Yard to have the boat towed up the Miami River to the yard. Prior to leaving Dinner Key, Mr. Reisman called C. A. Hansen Agency to confirm coverage on the trip and received a telegram to this effect:
The trip up the Miami River was uneventful. At the yard the vessel was tied to the pier and electrically connected. The Reismans had dinner aboard the vessel, and prior to their leaving, the bilge was pumped out and a normal amount of water was found. The next morning, however, the vessel was found sitting on the bottom with the water partly engulfing the deck housing. Hempstead & McGrath, professional salvors, were hired to raise the sunken vessel and during the attempted raising, the entire superstructure or house section of the boat was crushed flat. The vessel was declared a constructive loss and attempts to salvage were then abandoned. When the vessel was finally raised, same ten months later, the bottom was found to be honeycombed with wormholes which were assessed as the cause of the sinking. The insurer refused to pay on the insurance policy because it claimed that a sinking resulting from a deteriorated worm-eaten bottom was not a risk covered by the policy.
At the trial of the case, the Court inquired of the parties as to what issues of fact were to be submitted to the jury, and upon the insurer's failure to come forward with any issues of fact, and the Court's statement that there were no issues of fact; both parties waived the jury and it was excused.1 The Court found the issues in favor of the insurer, holding that the cause of the sinking was the worm-eaten condition of the hull, and that the insurer was not liable since this did not constitute a "peril of the sea" as contemplated by the policy.
Suit was filed in the state court, but the case was removed to federal court as a diversity case. Damages of $9,000.00 were claimed under the Hull Policy, plus $31,000.00 for damages resulting from alleged negligent acts of the salvors as agents of the insurer. The latter claim was the subject of the District Court's subsequent summary judgment when it held that the insurer was not liable for any amount in excess of $9,000.00. Mrs. Reisman contends that the granting of summary judgment as to all claims in excess of $9,000.00 divested the Federal Court of jurisdiction since there was not more than $10,000.00 in controversy. We disagree. The decisions under 28 U.S.C.A. § 1447 make it clear that once jurisdiction has attached, it cannot be subsequently divested. Haviland v. Western Union, 119 F.Supp. 438 (D.C.S.D.Tex. 1954); Service Finance Corporation v. Coppard, 5 Cir., 1940, 116 F.2d 488. In order to require a remand back to the state court for lack of jurisdiction, there must have been a lack of jurisdiction at the time of removal from the State to the Federal court. At the time of removal there was a bona fide claim in excess of $10,000.00. We find that the District Court had jurisdiction.
Mrs. Reisman offered no evidence which controverts the Court's finding that the cause of the sinking was the wormeaten and deteriorated condition of the vessel's bottom. We accept such finding as correct. Remaining for our determination is whether the sinking due to the above described condition was a risk covered by the policy.
The authorities are clear (and the insured has cited none to the contrary) that the loss of a vessel under circumstances here present does not permit recovery against the insurer. In R. T. Jones Lumber Company, Inc. v. Roen Steamship Company, 2 Cir., 1959, 270 F. 2d 456, the Court said:
"Perils of the seas are understood to mean those perils which are peculiar to the sea, and which are of an extraordinary nature or arise from irresistible force or overwhelming power, and which cannot be guarded against by the ordinary exertions of human skill and prudence."
The term "perils of the sea" as used in marine insurance policies does not mean that the policy covers all losses that occur upon the sea. As stated in Appleman Insurance Law and Practice, Vol. 5, § 3272:
"A marine policy protects against extraordinary accidents and perils, but not against natural decay and ordinary wear and tear."
Damage to the bottom of a boat by worms, in an area where worms ordinarily cause such damage, is not an extraordinary or fortuitous peril of the sea which cannot be avoided by human skill and prudence. The loss in this case...
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